False Representation?

In a statement posted on its website dated April 5, 2007 the US-China Business Council (USCBC) alleges that “A group called Global Labor Strategies has repeatedly mischaracterized the US-China Business Council (USCBC) position on China's proposed new Labor Contract Law” and accuses GLS of making “false representation.”  In a letter to the Washington Post April 17 it charges GLS with “misrepresentation.”  On the contrary, it is the USCBC that is misrepresenting GLS.

GLS has indeed issued two extensively documented reports, BEHIND THE GREAT WALL OF CHINA:  U.S. Corporations Opposing New Rights For Chinese Workers and UNDUE INFLUENCE: Corporations Gain Ground In Battle Over China’s New Labor Law – But Human Rights And Labor Advocates Are Pushing Back, which detail the actions of the USCBC and other representatives of U.S. corporations in China.  Along with its reports, GLS has also directly posted or linked to all of USCBC’s comments on the draft law so that readers could examine them in their entirety.

An examination of the USCBC’s statement and letter reveals that they do nothing to refute GLS’s charges.  Indeed, the USCBS makes a number of allegations that are simply false.

USCBC: “USCBC supports a balanced and fair Labor Contract Law and the transparent process by which it has been developed. USCBC is not lobbying against the law.” 

GLS’s charge has never been that USCBC has opposed the law, but that it has tried to gut it.  Indeed, it would be counter-productive for any corporate lobbying organization to directly oppose a draft law that has that has the popular support this draft law has and which is so far along in the Chinese legislative process. GLS’s charges, extensively documented in the GLS reports, are not even addressed, let alone refuted, in the USCBC statement and letter.  The US-China Business Council, in fact, told the PRC that elements of the revised draft are overly “burdensome,” “prohibitively expensive,” and will have “an adverse impact on the productivity and economic viability of employers.”  Who is “mischaracterizing” whom?

USCBC: “Certain provisions in the draft law need revision to ensure they do not adversely affect both companies and employees.  Our comment submissions detail our recommendations.”

They certainly do.  GLS’ reports examine those submissions in detail.  They show that USCB’s recommendations go to such central aspects of the legislation as provisions that would reduce the number of contingent workers and increase job security, give additional  rights to temp workers, provide some measure of bargaining over work rules and workplace standards, and provide support for laid off workers.

USCBC:  “The fact that many of USCBC's first set of comments, submitted last year, are reflected in the latest draft of the law indicates that the PRC government understood the spirit in which the comments were offered--that is, that the goal of our comments was to contribute to the government's development of a fair and effective employment contract law.”

Well, that’s one way to look at it.  Another way it to sum it up with the title of GLS’s second report: Undue Influence.  Indeed, USCBC’s here freely admits what the GLS report laboriously exposed – that USCBC and other representatives of U.S. corporations in China had a major impact on revision of the draft law.  Thanks for the confirmation, USCBC!

USCBC: “Substandard employment and environment, health, and safety (EHS) practices typically occur in local enterprises and sometimes in enterprises owned by other foreign investors, but rarely in enterprises directly owned by US companies.” 

USCBC’s comments are disingenuous.   “Enterprises directly owned by US companies” indeed often have showcase facilities.  But how about the suppliers whom they control and to whom they subcontract a large proportion of their work?  Big firms like Wal-Mart often produce little or nothing in China, contracting instead with thousands of supplier firms that they indirectly own or control. Through sheer market power these firms are able to drive down prices—thereby driving down wages and working conditions as well.  The result is a sweatshop culture in much of Chinese industry that appears to be “made in China” but is actually largely “made in the USA.”

How nice to have it both ways – a good public image for “enterprises directly owned by US companies” and profit-maximizing exploitation in those owned indirectly or used as contractors.  Evaluators of corporate responsibility, please take note!

But even here US companies are often not the good corporate citizens they portray themselves to be. In April two big US firms, McDonalds and Yum Brands (KFC and Pizza Hut) were charged by the government controlled ACFTU of paying part-time workers in their Guangzhou restaurants 40% below the minimum wage.

USCBC: “US companies tend to bring their global employment and EHS practices and standards to their facilities in China.” 

Thanks for confirming one of our central charges.  U.S. companies have indeed been exporting some of their most exploitative, anti-labor practices to China.  For example, they have been exporting temp work, day labor, non-compete agreements, resistance to collective bargaining, and employment-at-will to China.  Indeed, clauses putting modest limits on these practices – in which American corporations have been “leaders” – have been a principal target of the USCBC and other efforts to gut the law. 

GLS has put considerable effort into providing detailed and well-documented information for the public.  If USCBC truly believes GLS has misrepresented their position, we wish they would spell out where we have done so.  Even more, we wish they would reexamine their position and recognize that at present they have a moral obligation to support expanding rights for Chinese workers. Instead, they are painting a portrait of themselves as the representative of employers who wish to perpetuate those workers’ exploitation and oppression.

Comments

[Yaehoo]

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[yujuanzhai]

China legislation about draft labor contract law

China owns the most people and labor in the world. This law will be used by most people in the world. The extraordinary difference about the draft from the form labor law is it gives more right to employee, emphasizing the written labor contract, strengthening the inspection of the labor contract, limiting the labor dispatch. Those changes not only receive a lot of government agency, institute and worker’s response, but also have sharp difference in academic. The focus is about should give more right or the protective is excessively. At the same time, a voice to lob the legislature come from the foreign commerce committee, just like the American Chamber of Commerce in Shanghai and Europe commerce committee, They give the against voice to the draft law, a representative of Chamber said if the draft law pass in the future, they will withdraw the investment from the China. He said in the highest level meeting conclude the legislation officers ,the government offices and the scholars from the all of the China, in June 2006, in shanghai.
I think the draft law has many significant developments to protect the worker’s right and interests.
A the background of the draft labor contract law
The system of China labor law is different from the USA law. In China, there is no clear boundary between the labor law and employment law. In 1994, the China people’s notion committee regulates the first law about the labor and employment relation. Although the legislature’s name is the republic of China labor law ,this law is divided thirteen charters ,conclude the general rule ,promoting job, labor contract and collective contract ,work and rest time ,wages, occupational safe and health, the special protection for woman worker and juvenile workers, occupational training ,social security and beneficial ,labor dispute resolution, inspection ,legal ability and appendix. So the content of the labor law is so broad, but the law only have 117 articles, including individual employment contract and collective contract. In China, the individual employment contract is called labor contract, the relationship between the individual and the employer is called labor relationship .The contract between the employer and the group employee is called collective contract, the relationship is called collective labor relationship.
Because there is only one official union in China, the collective negotiation and collective agreement is having no real role in protecting worker’s right. Although the number of union is large, the role is small. When employees begin working for an employer, according the labor law, there must have a written labor contract. So in China, the individual labor contract is a main style to adjust the labor relationship ,the articles of the contract are the occupational post, work time, salary, occupational health and insurance, termination and penalty.
1, The worker’s right is serious infringe by the employer.
China’s labor contract system was begin in the mid-1980s, shift the tenure worker “iron rice bowl” to have relationship with enterprise by contract, this improvement confirmed in 1994 legislation. With the China economic development, the notional enterprise shifts the system, more and more agriculture immigration into the urban, called immigrate worker, they worked for every sorts of employers. The worker’s right is serious infringe by the employer. Accounting the labor law inspection investigation by the people’s notional committee, found some serious questions in real life, just like the ratio to have written labor contract is very low ,less than 20% in middle and little enterprise , the lower in the individual enterprise.
Many employers are avoiding bearing the legal liability for the worker. Employee often worked long hours, the overtime work is popular in China, but still earn so little. There is minimum wage in many province and cities, eve in the highest minimum wage city, the minimum wage of a month is around 100 us dollars , and the regular minimum wage is between 50-60 us dollars. The lowest minimum wage is only having the 30 dollar a month. But many workers could not get the minimum wages and over-time wages, they lived in very poverty life. Many employers would not buy any mandatory social insurance, workers have no any occupation protection in workplace, many workplace injuries occur every year . Another situation is the worker’s interest is harmful .some enterprise manual and employee handbook have infringe worker’s right, for an example “born, old, illness, death have no relationship with employer” “Employer have no liable with the accident”, “The man and women could not have in love, could not to marry, and no pregnant”, some employer make employer signature in blank contract.
The another problem in labor relation is the short term in labor contract. There are three term contract in labor law, definite term ,indefinite term and the term depending finish the task .Because definite term contract give more freedom and less cost , the employer prefer the short term labor contract avoiding the legal obligation . The one year term contracts are popular, and the tendency is the term become more shorter and shorter.
2, The labor law couldn’t give enough protection to workers.
There is only 11 articles to regulate the individual labor contract and 8 article of the collective agreement .After 1994 ,China rapid economic development and the workers rapid entrance the nonagricultural work to show the labor law ‘s defective ,the ministry of labor and social security have a lot of regulation to supplement the labor law ,and some have internal contradict ,
3,social conflicts
Some social conflicts is serious just like the no pay to worker ,short-time labor contract ,shortage the essential insurance ,low pay and overtime work hours ,no compensation to occupation injury and disease ,the long and complicate procedure to deal the labor dispute. The problem make the Chinese social contradict is deeply .Chinese worker’s foundation right and interests could get the enough protection. Many foreign academic could not understand China’s special problem .like why worker continual to work for some employer with no pay? Why the union leader respective the employer have litigation with the worker? just like the no-pay in China was once the popular social problem in last several years ,the phenomenon is improve after a women ask the premier wenjiabao to help her for her husband’s wage, this is actual situation in China ,many immigrate worker could not get own wages and the law’s protection is weak. The China government has pay concerned with the workers, and want protect the worker to keep harmony society. So the draft law have rapidly renounce, is a sign to protect the workers right.
labor dispute is raise rapidly ,in 1995 ,when the labor law effect ,there is 33 thousand case in the every level of labor dispute arbitration committee in the hole country, the employee involve in dispute is 123 thousands people ,in 2006 ,the number of labor dispute is , and the labor dispute is the most rapid case in China and courts.
B、the merit of the draft law
1,emphasis to protect the employee’s right and interests
In this law’s first article ,it is clear to claim the aim of this legislation have two , one is the protect the workers’ right ,the second is to improve the labor relationship to harmony, this aim of legislation have many debate, some people think the draft labor law is the labor relationship law ,just like the general contract law ,so the legislation’s aim to give the employer and employee same protection ,and this question have last for a long time ,but in the end ,the draft which annoyed is to emphasis to protect the worker. Maybe this question is not having so intense in foreign country, but it is importance for China labor law. From the first one item, the indirection of the law is clear.
2, emphasis to protect the employee have native influence on the investment? Some commerce committee said Many Atcham Shanghai member companies are concerned that, as the draft stands, it is a step backwards for Chinese economic reforms -- away from global trends of flexible labor markets needed to ensure continued economic growth. this question quarrel for a long time after the effective of the labor law .Some government didn’t strictly to supervisor the law just because want to appeal more foreign investment, but scarce the basic protection to worker could not get the enough workers, in general ,in recently years ,the zhujiang river district ,have serious problem like as “shortage of worker”, many factory only to quit just because there is no enough worker . No pay to workers ,no pay to overtime work, no enough prevent the employer illegal conduct ,the immigration worker could say by their feet . Some origination of USA estimates that even after five years of double-digit wage inflation in China, hourly compensation for Chinese manufacturing workers remains at only 3% of levels prevailing in the major industrial economies. So in China, the worker are the bottom of the society, the law should give them the basic protection.